Springs: data central

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Colorado Springs took a couple major steps this week toward the goal of becoming a data-center mecca.

On Tuesday, City Council unanimously approved a new service plan for 61 acres called the Vineyard Metropolitan District, south of Circle Drive and east of Interstate 25. Developer Vince Colarelli plans one or more data centers and other industrial uses on the property, adding to an existing lineup of local data centers that include those of Hewlett-Packard, Progressive Insurance and FedEx.

The service plan authorizes the district, now controlled by Colarelli, to issue up to $70 million in debt. It would be repaid using tax increment financing (TIF), in which taxes generated there are applied toward public improvements.

The developer's plan calls for $55 million in development costs to be publicly funded through tax financing and public improvement fees, the latter of which would be capped at $12 million. Council President Scott Hente notes the taxes and fees will be paid by the property owners, not the city.

"The city's not at risk," Hente says. "That's the important thing to remember."

In another development, earlier this week Wal-Mart closed on 24 acres in north Colorado Springs for its data center, paying $5.3 million to several companies controlled by Stephen J. Jacobs of Colorado Springs, according to county records.

Wal-Mart comes with a $6 million package of incentives that include city personal property tax exemptions, sales and use tax rebates, and other benefits from El Paso County, Academy School District 20 and the state. The center is expected to bring 40 permanent jobs paying up to $70,000 annually, and $12.2 million in tax revenue over 15 years.

"We expect construction to begin on the project once all the final approvals and permits are completed, about 4-6 weeks," Wal-Mart spokesman Joshua Phair says in an e-mail.

"One of the things Colorado Springs has always tried to do is position itself as a technology leader and a provider of good solid jobs," Hente says. "Data centers are technology centers. A data center doesn't employ hundreds, but it does bring in good solid jobs and the possibility for additional income down the road from business personal property tax they would be paying. And it positions Colorado Springs as a destination for data centers."